Study finds no link between the circumstances in the local economy, student unemployment and the level of subsidies handed out. So is it all political?

Those who argue that the Canadian federation exhibits plenty of fiscal and program biases against Prairie Canadians will see further evidence in a recent study from the Halifax-based Atlantic Institute for Market Studies (AIMS).

The study, Rethinking Student Job Subsidies, authored by David Murrell and Alan Chan, is subtitled The Case for Regional Equity in the Canada Summer Jobs Program. The study analyzes Statistics Canada data for the federal Summer Jobs Program between 2016 and 2018. This is the same program that recently became infamous when the federal government used it to push its moralistic values on abortion.

The original program was designed to encourage businesses and community organizations into hiring young people, full-time students in high school or university, aged 15 to 30, so they may acquire work experience during the summer months as they move toward joining the active workforce.

The authors found that in the period between 2016 and 2018, essentially the first three years of the current Liberal government, the Prairie provinces received significantly less money per unemployed student than the national average.

While the dollar amounts with the summer student subsidies pale in comparison to the massively lopsided federal Employment Insurance transfers and equalization payments, by and large they seem to reinforce the path of inequity much travelled by Prairie wealth, through Ottawa, and toward Quebec and Atlantic Canada.

Atlantic students receive, the analysis reveals, robust job subsidies above the national average, while the three Prairie provinces and Ontario receive job support well below the average.

The province that receives the most per unemployed student support is Newfoundland and Labrador. The province that receives the least per unemployed student is Alberta.

The magnitude of the disparity is a shocking: Alberta received five times less than Newfoundland and Labrador, and three times less than each of Prince Edward Island and New Brunswick. Even within the Atlantic region, the disparity between the Newfoundland and Labrador and the province in the region that received the least (Nova Scotia), is noticeably large: a student in Newfoundland received twice what a Nova Scotia student received.

The authors found that there doesn’t seem to be a link between the circumstances in the local economy, student unemployment and the level of subsidies handed out.

Although local federal politicians are involved in the assessment of applicants by constituency, and there’s a well-spelled-out process with criteria that in theory seems to want to avert whimsical decisions, the outcomes that point in a different direction are the more puzzling when one considers that “Employment Canada has the final say as to which applicants receive money.”

The criteria, if followed, awards points for “community needs, regional economic priorities, relevance of work, salary levels, employer supervision, treatment of official-language minorities, and affirmative action.”

That the points are assigned (or weighed) according to local priorities as determined by local MPs should introduce a measure of equity. But something else seems to drive the question of allocating the disparate compensation.

The authors of the study are careful not to speculate as to the motivations that drive the significant disparities. But the anemic outcome for Alberta uncovered in the study may well be driven by the reality that Alberta’s economic priorities don’t quite square, to put it in mild terms, with those of the federal government when it comes to the crucial question of hydrocarbon energy and all that is related to it: from exploration to exploitation, from transformation to transportation.

The authors, however, are quite aware that to any neutral observer the data raises more questions and may become an added piece in the deepening of regional differences. And those differences are often predicated through federal programs, which has an impact on perceptions and realities about national unity.

Specifically, the authors mention the added disparities in EI benefits and equalization payments, both of which have largely benefited the Maritime provinces (Newfoundland and Labrador doesn’t currently receive equalization) in the East and substantively extract money from the three western-most provinces.

While Ontario, Manitoba and Saskatchewan also receive less than the national average per unemployed student under the Summer Jobs Program, Alberta should take notice of the magnitude of the subsidy gap visited on that province’s young. And Alberta MPs, whose fingerprints are also on the applications of Alberta students, should be asking hard questions of Employment Canada about the apparent abysmal outcomes for their constituents.

Marco Navarro-Génie is a senior fellow with the Frontier Centre for Public Policy, and is the former president of the Atlantic Institute for Market Studies (AIMS).

© Troy Media


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